"Strategizing in hubs Exploration of the strategy formation process of three Hubs located in the Netherlands "

14-9-2017

STRATEGIZING IN HUBS

Exploration of the strategy formation process of three

Hubs located in the Netherlands

University: Radboud University Nijmegen - Faculty of management Master: Business Administration – Strategic Management Name: Manon de Bree

Address: Wagendwarsstraat 50, Utrecht Student #: S4211103

Email: manondbree@gmail.com Phone #: 06-20 52 04 83

1st _{Supervisor: Prof. Dr. J.J. Jonker}

2nd _{Supervisor: Dr. H.L. Aalbers}

2

Content

1.1 Research objective and research question ... 9

1.2 Scientific and practical relevance ... 10

1.2.1 Scientific Relevance ... 10 1.2.2 Practical relevance ... 10 1.3 Thesis outline ... 11 Chapter 2 Networks ... 12 2.1 Organizational networks ... 12 2.2 Collaborative networks ... 14 2.3 Hubs ... 16 2.3.1 Presence of Hubs ... 18 Chapter 3 Strategizing ... 20 3.1 Strategic vision ... 21 3.2 Strategy formation ... 22

3.2.1 Strategy formation: two opposing models ... 22

3.2.2 Key elements in strategy formation ... 25

A. Goal setting ... 25

B. Decision making ... 26

C. Choice making ... 27

3.3 Strategy as practice ... 27

3.4 Summary theoretical justification ... 29

Chapter 4 Methodology ... 30 4.1 Research design ... 30 4.2 Research object ... 32 4.2.1 Gloei ... 32 4.2.2 Dirk de Derde ... 33 4.2.3 Noorden Duurzaam ... 33

3

4.3 Data Collection ... 33

4.3.1 Document analysis ... 33

4.3.2 Introductory conversation ... 35

4.3.3 Group sessions ... 35

4.4 Data analysis technique ... 36

4.5 Quality of the research ... 38

4.5.1 Validity ... 38 4.5.2 Reliability ... 38 4.5.3 Researcher Integrity ... 39 Chapter 5 Results ... 41 5.1 Hub conditions ... 41 5.1.1 Gloei ... 41 5.1.2 Dirk de Derde ... 42 5.1.3 Noorden Duurzaam ... 43 5.2 Case Reconstruction ... 46 5.3 Case Confrontation ... 46 5.3.1 Oscillation ... 48 5.3.2 Organization structure ... 49 5.3.3 Societal function... 52 5.3.4 Visibility ... 55 5.3.5 Finances ... 58

5.4 Analysis of the additional properties ... 60

Chapter 6 Discussion & Conclusion ... 62

6.1 Discussion ... 62

6.1.1 Unique form of collaborative network ... 62

6.1.2 Fitting the properties ... 62

6.1.3 Emergence of strategy ... 63

6.1.4 Strategy as practice ... 64

6.1.5 Contribution to theory ... 64

6.2 Conclusion ... 65

6.3.1 Limitations ... 67

4 7. References ... 69 8. Appendix ... 74 8.1 Timeline Cases ... 74 8.1.1 Gloei ... 74 8.1.2 Dirk de Derde ... 75 8.1.3 Noorden Duurzaam ... 76

8.2 Preparation group sessions ... 77

8.2.1 Introduction ... 77

8.2.2 Structure group session ... 77

8.3 Transcripts group sessions ... 79

8.3.1 Transcript Gloei ... 79

8.3.2 Transcript Dirk III ... 102

8.3.3 Transcript Noorden Duurzaam ... 118

8.4 Codes ... 142

8.4.1 Codes primary document table... 143

8.4.2 Coded transcript Atlas.ti ... 144

8.5 Memo’s ... 145

List of Figures

Figure 2. Interaction maturity levels (Camarinha & Afsarmanesh, 2009). ... 16

Figure 3. Combination of Mintzberg (1994) and Camarinha & Afsarmanesh (2009) ... 21

Figure 4. Forms of Strategy (Mintzberg, 1994) ... 22

Figure 5. Two forms of strategy (Wiechmann, 2007; adapted from Mintzberg et al. 1998). .. 24

Figure 6. Process model for analysing regional strategy formation (Wiechmann, 2007) ... 25

Figure 7. The Golden Pentagon (Group session Dirk III, 2017) ... 53

List of Tables

Table 2. Overview of used documents ... 34

Table 3. Overview of properties in relation to Hubs located in the Netherlands ... 45

5

Preface

This research represents the closing chapter of my studies at the Radboud Universiteit Nijmegen. The first four years of my studies I followed and obtained my bachelor’s degree in business administration. During my bachelor I had the opportunity to study at Oregon State University for a year and expand my horizon. Moreover, I was lucky to take part in the board of two student associations and develop my leadership abilities in practice. The last year of my studies I followed the master programme in Strategic Management. I’m very fortunate to say that I had the chance to follow the courses designed for the master Strategic Management and my appreciation goes out to all professors that invested the time to share their knowledge. This last year was dominated by big dreams, hard work, great focus and surrounding myself with bright and fun people. Therefore, I would like to use this opportunity to show my gratitude to the people that helped me during my master year and especially during my master thesis. First of all I would like to thank my supervisor Jan Jonker for freeing the time to provide the criticism and feedback needed to finalize my thesis. I would also like to thank Moniek Kamm for her unconditional support, for her time, for the amusing talks and for her guidance into the world of Hubs. I would also express my gratitude to the members of the Hubs Gloei, Dirk de Derde and Noorden Duurzaam for their openness and willingness to participate in this study. The last person I would like to thank is Bart Cornel who made sure that I achieved my full potential through expressing his unconditional faith in me and for his constructive feedback on my thesis. I really enjoyed conducting this research and I hope you will have fun reading it!

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Abstract

Society’s emerging focus on social responsibility and sustainability leads to a new form of organizing that differs from a conventional organization. This new form of organizing highlights societal- and ecological value rather than economic value and formalizes its vision in the community based collaborative network: the Hub. A Hub is a polymorphic, horizontal network structure that involves multiple participants to initiate and facilitate sustainable projects in a well-defined region. A Hub distinguishes itself by its focus on sustainability and its ability to create multiple value. Consequently, Hubs have to follow a certain direction so they can achieve its vision. The process of finding out which direction needs to be followed is called strategizing. The Hub makes choices, decisions, and goals that lead to strategy formation. The strategy formation process of Hubs has not been extensively researched and is as such a new and interesting research subject. The strategy formation process of Hubs is shaped by multiple influences that are not mapped yet. The lack of knowledge on this subject formed the basis for studying the strategy formation process of three Hubs that are located in the Netherlands. Document analysis was applied to identify the past and present state of the Hubs. In order to expose the strategy formation process in general and the conditions that influence the strategy formation process in depth, group sessions were held at the Hubs. The document analysis and the group sessions revealed that Hubs meet certain properties that identify them as a unique form of a collaborative network. But foremost, the study exposed several conditions and dimensions that shape the strategy formation process of Hubs. Hubs need to deal with these factors and adapt its goals, decisions and choices so they will finally reach continuity. The conditions and dimensions that came out of this study can help Hubs, to organise their strategy formation process in a more efficient and effective way.

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Chapter 1 Introduction

Since the Club of Rome (1968) came into existence and described itself as "a group of world citizens, sharing a common concern for the future of humanity"1_{, social responsibility was} prominently placed on the world map. However, even before the establishment of Club of Rome academics were stressing the importance of social responsibility. The first academic definition of social responsibility came from Bowen & Johnson (1953): ‘an obligation to pursue policies to make decisions and to follow lines of action which are compatible with the objectives and values of society’. When the academic world noticed the importance of social responsibility it advocated the concept for decades, but slowly a debate between academics, organizations and society started, circumferential the definition of social responsibility and the implementation of social responsibility (Smith, 2011). Despite the ongoing discussion on the relevance of this topic, social responsibility became important for organizations and has evolved into a focus on societal and environmental value for organizations. The focus on society and environment influences goals, decisions and choices for organizations, which directs the organization in a certain direction. A strategic direction helps companies to anticipate and take advantage of changing societal expectations and operating conditions and thereby help them build long-term employee-, consumer- and citizen trust. The higher levels of trust, in turn, help organizations, and other forms of organizing, to create an environment in which they can innovate and grow (EU commission, 2011). The focus on society and the organizations’ environment leads to organizations striving for sustainability. Sustainability does not have a universal definition, so in this study sustainability is defined as: ‘a life-enhancing condition within communities, and a process within communities that can achieve that condition’ (Mckenzie, 2004). This definition is in line with the movement that got exposed in the past twenty-five years. Whereas the focus on sustainability has been shifted away from an environmental, policy-guided perspective to an organizational value-creation perspective (Jonker, 2014).

The focus on social responsibility, and the wellbeing of the environment, seen from an organizational value-creation perspective leads to forms of organizing that are different from the conventional organization that focuses on economic value and profit maximization. This perspective follows the environmental, policy-guided perspective. Consequently, a new form of organizing emerges: the Hub. A Hub is ‘a polymorphic, horizontal network structure that connects diverse participants linked by a common aim to cooperate, co-create shared values,

8 and realize common goals’ (Kamm, Faber and Jonker, 2015). A Hub allows multiple participants to collaborate in sustainable projects executed in a well-defined region. This new form or organizing differs from a conventional organization for predominantly two reasons: its focus on sustainability and its ability to manage multiple value creation. Explanatory, a Hub is based on collaboration of participants, which enables the Hub to fulfill the demand of social and ecological value besides the demand of economic value (Jonker, 2012). Hubs strive for sustainability in a region. This region could be restricted to a town, a county or even a province, but the participants of the Hub need to have a connection with the region it operates in.

In a Hub multiple participants collaborate, which leads to a configuration of several participants. Conventional organizations are not used to collaboration between multiple participants and struggle with collective organizing. However, collective organizing helps Hubs to manage their multiple objectives. Conventional organizations are not used to deal with multiple value creation because they do not have multiple objectives to fulfill. Collective organizing entails collaboration between a Hub and citizens, but also between communities and citizens and Hubs and communities, and all based on co-creation (Jonker, 2012). Co-creation often emerges out of incidental collaboration, which is fostered by a Hub. Collaboration of multiple participants and the aim to fulfill multiple objectives ensures that Hubs have a different perspective on value creation. Value creation, for Hubs, is principle-based and purpose-driven (Jonker, 2014). Hubs focus on themes that are valuable to the participant’s involved and so commitment to the Hub is important. Commitment to the Hub is shown in possessing joint goals, creating joint identities and realize joint projects. However value can only be created when the participants collaborate efficiently. Therefore the structure of the Hub needs to foster collaboration. An organizational structure that fits the purpose of a Hub is a collaborative network. A collaboration always requires a network of connections, but not all networks assuredly involve collaboration, which means that the term collaboration in this context has to be interpreted as an adjective to qualify a specific class of networks (Camarinha-Matos, Afsarmanesh, 2004; Nieto & Santamaria, 2007). Hubs can be aligned with networks and evolve as a unique class of a collaborative network. By being a community based collaborative network the Hub follows its vision that is based on societal and ecological value. Having a vision and working towards executing that vision is thinking about a strategic approach. Hubs facilitate and/or initiate plans and projects for the short, medium and long term and decide how and if these initiatives are executed and integrated. To understand if and how strategy is built within Hubs, the strategy formation process comes into play. The strategy formation process is defined as ‘flexibly shaping the course of action by gradually blending together initiatives into a

9 coherent pattern of actions’ (de Wit & Meyer, 2010). The strategy formation process of Hubs is influenced by multiple internal- and external forces that force the Hub to choose a certain direction. Up till today, there is little known about the strategy formation process of Hubs, and about the factors that influence this process.

How and under which conditions strategy is being shaped in Hubs is still a ‘black box’ and therefore this study will investigate the manner in which this strategizing process as a practice occurs in Hubs.

1.1 Research objective and research question

A Hub is a new form or organizing in which collaboration and multiple value creation are key. By following its vision, a Hub makes certain choices, decisions, and goals. These choices, decisions and goals force the Hub into a certain strategic direction. The Hub its strategic direction is part of the strategy formation process that this study is interested in. Strategy formation in a Hub has not been extensively researched and is as such a new and interesting research subject. Moreover, little is known about the conditions that influence the strategy formation process of Hubs. This lack of knowledge restricts Hubs from improving their strategy process and thus from developing their way of organizing. This study tries to reveal the strategy formation process and expose the factors that influence this process in three Hubs located in the Netherlands.

Therefore the research objective of this study is:

To provide insight in the strategizing processes of Hubs, in order to gain knowledge about how, and under which conditions this is being shaped.

The research objective leads to the following research question:

How and under which conditions is strategy being developed in Hubs?

To be able to answer the research question, the following sub-questions are addressed:

1. What are the features of strategy formation in Hubs?

2. Which conditions influence the strategy formation process of Hubs?

Through organizing group sessions at three Hubs, located throughout the Netherlands, the strategy process of these Hubs is exposed. By reconstructing critical events in the lifetime of the Hub and revealing the internal- and external forces that influence the Hub, the strategy formation process will be analyzed.

10 1.2 Scientific and practical relevance

1.2.1 Scientific Relevance

Hubs mainly focus on creating societal and ecological value. As such it can be assumed that their strategy formation process will be shaped by other features and conditions than the strategy formation process of conventional organizations. Whereby conventional organizations are defined following only the norms of economic value creation. That the strategy formation process of conventional organizations is influenced by different factors is based on research between the differences in strategy formation of voluntary organizations and conventional organizations. This study aims to clarify the strategy formation process of Hubs and find out which features and conditions have a stake in this process. This study will add to the literature on strategy formation, by shedding light on its possible development. Zooming in on this process: strategic choice, decision making and goal setting are involved in both the strategy process of Hubs as well as the strategy process of conventional organizations. Therefore studying these concepts will help the scientific world to gain information on the differences in strategy formation of Hubs and of conventional organizations. This study is also important for the scientific world because it studies something that has not been researched (extensively) before. The knowledge that is gained with this study helps other researchers to study strategy formation in Hubs from other perspectives. Academics can use this study as a precedent for further research into the strategy process of Hubs, in or outside the Netherlands.

1.2.2 Practical relevance

By providing insight in the strategy formation process of Hubs, this study can help Hubs to enhance their continuity and elevate their success. Multiple participants have a stake in the strategy formation process of a Hub and as such they can use this study to successfully collaborate in a Hub and create multiple value. By gaining knowledge on the strategy formation process better choices and decisions can be made and more reliable goals can be set. Also new Hubs can learn from the choices made in the past. Hubs can adapt their choices by following the lead of the studied cases or avoiding contra productive issues.

This study also has positive implications for the researched Hubs itself: Gloei, Dirk de Derde and Noorden Duurzaam. These Hubs gain insight in their own strategy formation process and learn which features and conditions shape the direction of the Hub. Gaining knowledge about the important decisions and choices that were made in the past, and knowing which decisions were critical for the wellbeing of the Hub, can be a leading factor for the decisions and choices that the Hub will make in the future.

11 1.3 Thesis outline

The following chapters contain the theoretical background of this study. The first chapter will start with an elaboration of networks in general and end with an explanation of collaborative networks. The next chapter will build upon the first chapter by explaining strategic vision and strategy formation for Hubs. Chapter four concerns the methodology of the study. This methodology chapter will elaborate on the choice of research design and the way the data was collected. The fifth chapter contains the results from the data analysis in response to the data collection. The final, and sixth, chapter includes the discussion, the conclusion and implications for theory and practice. This chapter will also discuss the openings for further research. Chapter seven shows the used references in this study and chapter eight includes the most important appendices.

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Chapter 2 Networks

The objective of this chapter is to gain insight in the organizational structure of Hubs, so that ultimately the strategy formation process of Hubs can be revealed. First, the chapter will elaborate on organizational networks that form the basis for the organizational structure of a Hub. After that the collaborative network is introduced, which is a specific form of an organizational network and based on collaboration. The chapter ends by explaining Hubs as a unique form of a collaborative network and providing information about the presence of Hubs in the Netherlands.

The term ‘network’ is used much, but is often interpreted in different ways. One way the term ‘network’ is described is as: ‘a structural condition whereby distinct points (often called ‘nodes’) are related to one another by connections (often called ‘ties’)’ (Barney, 2004). This is also called a web of relationships formed by people to get things done (Daft, 2015). Ties are typically multiple, intersecting and often redundant. Moreover, a network only exists when nodes are connected to other nodes by many ties (Barney, 2004). This definition of a network focuses particularly on the actors within the network. Another way to interpret the term ‘network’ is by focusing on the structure of networks. This perspective sees organizations as in-between market and hierarchy. Networks in this definition are hybrid forms that are not easily conceptualized by existing organizational theory or by mainstream economics (Aalbers, 2012; Powell, 2003). Both perspectives justify that a network acts as a connector between entities. Paragraph 2.1 will elaborate upon such a connector, the organizational network. 2.1 Organizational networks

Research on networks has grown exponentially the past few years. The original focus of this research was based on understanding if and how embeddedness of individuals in the network influenced their behaviour. Later on this argument has been extended towards organizations (Gulati, 1999, Gulati, & Dialdin, & Wang, 2000). A factor that called attention to networks, was the high success rate, of especially Japanese companies, that relied extensively on the network form as an organizational structure. The competitive success of these organizations triggered both scholars and practitioners to start gaining knowledge on the relevance of the network form of organizing as a determinant of competitive success (Podolny & Page, 1998; Lincoln et al. 1996). The emerged academic attention on networks is part of a general shift away from individualist’s explanations towards more relational and contextual understandings (Borgatti & Foster, 2003). Organizational networks (network organizations) are seen as new forms of organizing as they do not fit the typology of vertically organized hierarchies, or

13 marketplaces that are governed by supply and demand (Wasserman & Faust, 2006; Powell, 2003). The network structure as explained here is an alternative to a market or an organizational hierarchy (Barringer & Harrison, 2000). The network organization is flexible and dynamic and uses relationships and linkages to connect multiple organizations and people into new entities that can create products or services (Wasserman & Faust, 2006). Organizations can be interconnected with other organizations through a wide array of social and economic relationships, each of which can constitute a social network (Gulati, & Dialdin, & Wang, 2000). A social network is a finite set or sets of actors and the relation or relations defined on them (Wasserman & Faust, 2006). Specifically,

a firms’ network consists of the central firm, also called the ego, and a set of other firms, called the alters. The alters have ties with the ego, but there are also ties between alters, as can be seen in Figure 1. (Wasserman and Faust. 1994). Within the network the ego can obtain resources and information from the environment in an interdependent relationship with a complex array of firms (Gulati, & Dialdin,

& Wang, 2000; Barringer & Harrison, 2000). The network and its linkages are constantly adapting as new links are added and dysfunctional ones are dropped. Thus, the evolving, emerging organizational form is called the organizational network(Wasserman & Faust, 2006).

The organizational network emerges out of the defined social network. Within organizational networks, social networks are distinguished as ‘a set of actors and one or more relations between the actors’ (Wasserman & Faust, 2006). Nohria (1992) clearly states that all organizations are social networks and need to be addressed and analyzed as such. Social networks are embedded in the network organization as they are organized through establishment of social, rather than legally binding contracts (Barringer & Harrison, 2000; Atler & Hage, 1993; Jones et al., 1997).These networks have a social focus which emphasizes the multiple and complex relationships of the actors within the network. For example actors may be social units, including individuals, collective entities, firms, organizations and divisions within organizations (Contractor & Monge, 2002). As far as relations; they can be of any kind of linkage between the actors. The linkages can be ‘formal role relations, affective expressions, social interactions, workflows, transfers of material resources, retrieval of knowledge or flows

14 of information’ (Wasserman & Faust, 2006). The actors and linkages share one characteristic: they all emerge in the firm and therefore are not preplanned (Krackhardt, 2003).

In conclusion, the organizational network consists of a part that focuses on the ‘structure’ of the network and another part that highlights the social relationships within this network. This study will focus on the relationships of the participants in a phenomenon that is based on a network organization where ‘active connections among people: the trust, mutual understanding, shared values and behaviors that bind the members of human networks and communities make cooperative action possible’ (Cohen and Prusak, 2001; Schoemaker & Jonker, 2005).

2.2 Collaborative networks

Collaboration, or organizing, literally means working together (Huxham, 1996; Bititci, Martinez, Albores, Parung, 2004). The term collaboration is often used as a natural approach to achieve common or compatible goals that an individual cannot achieve alone, by means of searching for solutions that go beyond its own limited vision of what is possible (Camarinha-Matos & Afsarmanesh, 2005). A collaboration exists between individuals, or between organizations that decide to work together with the goal to achieve mutual benefit. Collaboration is a process in which networks share information, resources and responsibilities to jointly plan, implement, and evaluate a program of activities to achieve a common goal and therefore jointly generating value (Huxham, 1996; Camarinha-Matos & Afsarmanesh, 2009). Collaboration between organizations, or organizational networks, can be initiated for many reasons: economic, social, technological and/or political. However, all participants should benefit from the collaboration and the collaboration should increase the internal value to the shareholders as well as delivering more value to the customer (Bititci, Martinez, Albores, Parung, 2004). If all participants benefit from the collaboration it is likely that participants sustain the collaboration and that common goals will be achieved.

The reason for a collaboration between organizations is often value creation, but the implementation of collaboration in organizations is quite difficult. First of all, a lot of effort is needed to get involved and integrated in the network organization. Second, the collaboration needs to be implemented at all levels within the network organization: operational, tactical and strategic (Bititci, Martinez, Albores, Parung, 2004). To be able to sustain collaboration a network of connections is required (Camarinha-Matos, Afsarmanesh, 2004). However, not all networks assuredly involve collaboration, which means that the term collaboration in this context has to be interpreted as an adjective to qualify a specific class of networks (Camarinha-Matos, Afsarmanesh, 2004; Nieto & Santamaria, 2007). Therefore Camarinha-Matos and

15 Afsarmanesh (2009) defined the collaborative network as ‘constituted by a variety of entities (e.g., organizations and people) that are largely autonomous, geographically distributed, and heterogeneous in terms of: operating environment, culture, social capital, and goals’. To illustrate this definition Camarinha-Matos and Afsarmanesh (2009) designed a framework that involves different levels of collaboration, for which different types of networks are distinguished. The framework as shown in Figure 2 identifies collaboration by using the degree of interaction maturity and the degree of integration. The framework starts with the level of ‘networking’ that enhances the exchange of communication and information, so that both parties could benefit. The second level is ‘coordinated networking’ that specifies a network linked to aligning activities of the participants involved, so that the results of the process will become more efficient. The third level is the ‘cooperation’ form of networking, which adds the term resource sharing as a way to achieve united results by sharing each other’s resources. In the cooperation form of networking participants have complementary goals, but are still separate entities. The fourth, and last level of networking is described as ‘collaboration’. Collaboration focuses on the participants that pursue joint goals and have joint identities which they use to jointly generate value. This form of networking ensures the highest factor of interaction maturity and integration, which allows participants other than companies to join the collaboration. The structure of a collaborative network that consists of joint goals, joint identities and joint responsibilities appeals to organizations and also to other participants like public authorities and citizens. This large range of interest follows from its focus on fundamental change in the organization of society in which all participants are involved. Considering the above-mentioned characteristics this fits the purpose of a Hub. Therefore this study considers Hubs a specific form of a collaborative network. The Hub gives participants the freedom to add ideas to the equation and therefore provides more than the means of realizing overlapping and common goals. ‘Hubs are thick, polymorph, and polycentric networks driven by practitioners, shaped around multiple, wicked and interlinked problems, shared interests, and shared principles’ (Kamm, 2017). This unique form of a collaborative network often focuses on topics like energy, food supply or care executed in sustainable projects for the region they operate in. A Hub ideally facilitates, and sometimes initiates, projects that give participants the opportunity to work together on topics that they consider important. This way a Hub fosters the social, economic and political relationships in theregion.

16 2.3 Hubs

Numerous organizational structures have been developed to coordinate and direct people's collective actions and activities (Simon, 1964). The increase of new organizational structures is due to a build-up interest from civilians in participating or instituting in cooperative initiatives (Kamm, 2017). This build-up interest leads to new initiatives in which different organizations and individuals collaborate to address complex issues as energy, waste, food, care etc. (Kamm, 2017). When people and organizations cooperate and adopt existing legal and governmental organizational structures; they form a cooperation, a foundation, or an association to embed their common cause and/or goal (Kamm, Faber & Jonker, 2016). The organization structure that emerges is called the Hub. A Hub is a unique form of collaborative network that exists of collective organization and multiple participants. By bundling their strengths participants can benefit from shared results generated by processes of multiple, collective, and shared value creation (Faber & Jonker, 2015). Hubs are strategizing forms of organizing whereby multiple participants, both organizations and individuals, collaborate to address multiple, interconnected, complex issues, aiming at a long term transition of a region. Seven properties are defined that identify Hubs from other forms of organizing.

1. Operating in a local or regional setting;

17 2. Addressing wicked problems;

3. Leading to a broad configuration of participants; 4. Engaging in multiple value creating activities; 5. Issue related approach;

6. Shaped organizationally in an unconventional way; 7. Leading to a transition over time.

(Kamm, Faber & Jonker, 2016, P. 6) The properties will be explained below. Hubs are initiated on a local or regional level. The region in which a Hub operates can be indicated as a specific territory that can be specified in a province, a county or even a township. The second property identifies that Hubs address wicked problems. The appearance of wicked problems grows because more and more values of society become intertwined. Politics, environmental and societal values cannot be faced separately anymore, as they are involved the same issues. Conditions that seemingly solve an issue often turn out to be incomplete or contradictory as a result of other factors get mixed up in these issues. As a result, these issues may require different and/or new solutions over time. The third property involves the number of participants that are involved. Hubs have a broad array of participants in contrast to other networking forms of organizing. Public authorities, companies and citizens can all participate in a Hub, which makes a Hub a network that addresses multiple objectives. By pursuing multiple objectives Hubs create multiple value, which is the fourth property. The participants provide resources: time, energy, money, knowledge etc. These resources are shared among the participants leading to multiple, collective and shared value creation. To create multiple value a multi-party issue related approach is needed which is indicated by the fifth property. It is not possible to organize a Hub following the conventional rules that apply to organizations, because Hubs initial purpose is to foster value creation and sustainability instead of maximizing profits. A Hub needs a multi-party related issue related approach to tackle all of the forces that have an influence on the wellbeing of the Hub. The sixth property states that a form of organizing needs to be shaped in an unconventional way. Hubs distinguish itself from other forms of organizing by creating a network of participants that collaborate on sustainable topics without a clear organization structure. The seventh and last property states that a Hub needs to lead to a transition over time. A Hub needs to foster transition in the region it operates in so it fulfils the purpose of fundamentally change society. This property also embeds the ability of Hubs to strengthen communities by connecting a diversity of participants. The above mentioned properties reflect that a Hub is a unique form of a

18 collaborative network and as Kamm, Faber and Jonker (2015) state: ‘a multitude of participants forming a horizontal form of organising brings a multitude of views on how to realize an organizational form that encapsulates shared values and common goals’.

To clarify the relationship between organizational networks (ON’s), collaborative networks (CN’s) and Hubs, Table 1 illustrates the characteristics of each form of organizing. The collaborative network is related to the family tree of organizational networks. The Hub possesses characteristics that are similar to those of collaborative networks, but at the same time a Hubs has its unique features. The Hub meets the collaborative network in the spectrum of joint goals, joint identities and joint responsibility, however the Hub extends this idea by striving for a transition in society.

Table 1. Comparison of characteristics of ON's, CN"s and Hubs.

2.3.1 Presence of Hubs

Hubs arise all over the Netherlands and around the globe. This study however will solely focus on the Hubs located in the Netherlands. As more Hubs arise attention for and recognition of Hubs increases. The Dutch government got inspired by these new forms of organizing and established the National Service of Entrepreneurship (Rijksdienst Voor Ondernemend Nederland (RVO)) and the program: DuurzaamDoor. DuurzaamDoor supports and connects regional and national networks of entrepreneurs, education, research, government and citizens’ organizations (www.duurzaamdoor.nl). DuurzaamDoor is a platform for Hubs to find support and it is platform for Hubs to meet like-minded initiatives.

There are around 20 initiatives in the Netherlands that can be identified as Hubs. This study strictly focuses on Hubs that consist of the collaboration between public authorities,

Organizational networks

Collaborative networks

Hubs

Initial focus Earning money Creating value for the

customer

Regional sustainability

Flow of information Uni-directional and

multi-directional

Multi-directional Multi-directional, with a preference for bottom-up

Mind-set Search and explore as

necessary, do as told

Reach out, cooperate Experiment & collaborate to solve problems

Intended result Profit Collaboration Transition

Participants Organizations Organizations &

individuals

Organizations, public authorities & civilians

Form of value creation Separate, with the

intention of creating new entities together

Unified, create more value together

Multiple, strive for a common cause/goal

19 organizations and citizens. Furthermore the Hubs need to make an economical contribution to the region besides its main focus on societal and environmental value. The reason that this study only includes Hubs that consist of a mix of participants is because this study identifies Hubs as pluralist organizations that strive for collaboration between participants to create multiple value creation. The focus on economical contribution to the region is important because this implies a certain professionalism of the projects that the Hub facilitates.

This study will involve three Hubs that are located in different areas in the Netherlands. These Hubs are all established within the past 6 years and so are relatively young forms of organizing. The three Hubs that are used as cases in this study will help to clarify the strategy formation process within Hubs by gaining insight in the choices they have made during the lifetime of the Hub. The Hubs will help to clarify the choice for a certain organizational structure and they will identify the forces that have an influence on the decisions and choices that the Hub makes. This study will make an important contribution to the strategy literature, by providing insight in the conditions that determine the strategy formation process of Hubs.

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Chapter 3 Strategizing

This chapter elaborates on Hubs seen as strategizing forms of organizing. Therefore the strategizing process of Hubs is examined. At first the concept of strategic vision is introduced. Next the strategy formation process is discussed, including an elaboration on the key elements that shape strategy formation. After that the model of Wiechmann (2007) that illustrates the process of strategy formation is introduced This model shows the differences between strategy formation in Hubs and strategy formation in other forms of organizing. In the end the ‘strategy as practice’ approach is discussed, which will form the theoretical foundation for strategy formation in Hubs.

History tells that many academics have tried to define the concept of strategy. Steiner (1979) once pointed out that there is very little agreement as to the meaning of strategy in the business world. Even up till now this statement lasts because the perspective on strategy is still defined differently by scholars, academics or managers. Not only can strategy be seen as a perspective, also the perspective on strategy is continuously changing. Perceiving strategy from multiple perspectives is consistent with the mode of thought of Mintzberg (1994). Mintzberg suggests that strategy can be seen as a perspective, a position, and a plan or/and a pattern:

1. Strategy is a plan, a "how," a means of getting from here to there.

2. Strategy is a pattern in actions over time; for example, a company that regularly markets very expensive products is using a "high end" strategy.

3. Strategy is position; that is, it reflects decisions to offer particular products or services in particular markets.

4. Strategy is perspective that is building vision and direction.

(Mintzberg, 1994)

The latter definition of strategy, as seen as a perspective that is building vision and direction, is consistent with the new movement that arises in the strategy literature. Whereas building strategy along the way overshadows the pre-planned strategy approach. Nowadays, academics tend to focus more on strategies that are formed in practice. To be sure that organizations can actually form new strategies, Hamel (1998) has defined certain preconditions. The preconditions state that forms of organizing need to be amenable to: 1. new voices; 2. new conversations; 3. new passions; 4. new perspectives, and 5. new experiments. Kamm, Faber & Jonker (2016) and Kamm (2017) use these preconditions to indicate that Hubs are strategizing forms of organizing ‘full of new voices engaging in new conversations and sharing a ‘passion’

21 for cooperative action’. Regarding these preconditions Hubs should be breeding grounds for the emergence of new strategies.

3.1 Strategic vision

Because a strategy isn’t conceived and executed overnight, sensing what the essence of the firm is and which direction it should take is the first step towards shared understanding, which is at the heart of strategic vision (Schoemaker, 1992). Strategic vision, or strategic thinking, is about synthesis. To align the goals that the organization wants to pursue with the route it has to take to get there. A vision is a put into words strategic direction for the organization that is open for changes and can be adjusted through time. Furthermore, a vision must have the chance to appear at any place and time in the organization. Strategic vision, as elaborated upon in this study, sees strategy as a perspective that builds vision and direction. Developing strategic vision is one of the first steps in the strategy formation process.

Hubs need strategic vision to achieve collaboration and subsequent multiple value creation. Strategic vision helps Hubs to move into its desirable direction by attracting the right participants to start the collaboration and chase multiple value creation. In Chapter 2 the table (figure 2) of interaction maturity levels of Camarinha & Afsarmanesh (2009) is introduced, which identified the collaboration form. This form of collaboration can be linked to the strategy definition retrieved from Mintzberg (1994). Figure 3, combines the two perspectives to clarify that a visionary perspective on strategy and a focus on collaboration, shape the strategic direction of the Hub. For a Hub to build vision and direction, it needs joint goals to align the strategy. It also needs joint identities to be able to form a unified vision and choose a unified direction. Joint responsibility and joint creating are important for strategy as it shows the horizontal polymorphic structure of the Hub. The relationship between the features of collaboration and the perspective on strategy are multi-directional.

22 3.2 Strategy formation

Strategy, in the past, has been conceived in terms of what the leaders of an organization ‘plan’ to do in the future. However, Mintzberg & Waters (1985) argue that it is indeed important to see a strategy formation process as an analytical process of long-range goals and action plans, but the process should also be viewed from a wider, behavioral, perspective, so that the variety of ways in which strategies actually take shape can be considered. The label ‘strategy’ can be used for both the analytical formation process and the behavioral formation process. Moreover the analytical formation process is called the intended strategy and the behavioral formation process the realized strategy. Both types of formation processes encourage exploration (Mintzberg & Waters, 1985). Organizations often have predefined plans, visions and/or goals when they become operational and therefore identify more with the analytical formation process. Meanwhile Hubs develop their course of action along the way and thus identify more with the behavioral formation process. Strategy is built when ‘a sequence of decisions in some area exhibits a consistency over time’ (Mintzberg, 1978). The stream of decisions can follow several paths: intended, deliberate, realized and emergent (Mintzberg, 1987; Mintzberg, 1996; Mintzberg & Waters, 1985). The intended strategy flows into a deliberate strategy which is envisioned and preplanned. The emergent strategy is not consciously directed, but emerges during organizing. The realized strategy is the strategy that will finally be implemented in the organization. Figure 4 shows the different paths of strategy formation and the influence of these paths on the realized strategy. The paths of strategy formation are the result of the process that is described in Figure 3. Figure 3, shows the pre-conditions that are needed to be able to build strategy and choose one of the paths shown below.

23 3.2.1 Strategy formation: two opposing models

The theoretical foundation for strategizing and strategy formation is developed in the last thirty years. Within the literature a distinction is made between two opposing strategic models: the linear model and the adaptive model (Mintzberg et al. 1998, Wiechmann, 2007). The distinction between these two models is based on the way they handle strategic formation processes: ‘to what extend does comprehensive planning make sense in dynamic environments?’ (Wiechmann, 2007). The answer to this question helps to figure out which model (linear or adaptive) fits the strategy formation process of Hubs. The linear model sees strategy as a plan, as a deliberate and intentional planning process. ‘The linear process consists of a formalized analysis, a thereon based strategy formulation, which is finally followed by an implementation phase. The end is defined independently of the means’ (Mintzberg et al. 1998, Wiechmann, 2007). The adaptive strategy model is based on the actual outcomes of a strategy and not only on future objectives and goals, with the underlying meaning that only part of the realized strategies are consciously planned (Wiechmann, 2007). The adaptive model is based on the emergent strategy, which is a realized strategy that is not intended. An emergent strategy is a pattern developed in the absence of intentions, or despite them. When the factor of intention is taken out of the equation a strategy may form gradually, often unintentionally, as the decisions are made one by one (Mintzberg & Waters, 1985). An emergent strategy is considered perfect when there is order consistency in action over time and there is no intention. Just like the perfect deliberate strategy it is rather unlikely that an organization is able to perform a perfect emergent strategy. Emergent strategy is considered open, flexible and responsive or in other words emergent strategies are willing to learn. These characteristics are most important when the environment is unstable or complex as emergent strategies enable the management to act before everything is fully understood (Mintzberg, 1978; Mintzberg & Waters, 1985). Figure 5 illustrates both models. Mintzberg & McHugh (1985) dwell upon these two strategy models and illustrate them by using the example of cultivating tomatoes. The linear model is a controlled process, just like cultivating tomatoes in a hothouse. The adaptive model is illustrated by the ‘grassroots model’. This model shows that ‘strategies are not planted and cultivated like tomatoes in a hothouse, they grow like weeds in a garden’ (Wiechmann, 2007). ‘the decisions that emerge from the complex processes in which individual managers interpret the intended strategy and adapt to changing external circumstances’ (Mintzberg, 1978; Mintzberg & Waters, 1985) builds the path towards the realized strategy. Hubs build strategy along the way so ‘what is needed is an inclusive conception of strategy that incorporates not only collectively defined

24 objectives and planned action but also gradual adjustment to emergent strategies, retrospective interpretation, and collective learning’ (Wiechmann, 2007). As such, the adaptive model accurately fits the strategy formation process of Hubs. The adaptive model encourages strategies to root anywhere in the organization, because everywhere in the organization are participants that have the capability to learn. Strategies that are rooted somewhere in the organization may lead to patterns that can be adopted in the entire organization and so become collective and organized (Kamm, Faber, Jonker, 2015). The adaptive model includes the emergent aspect that fits perfectly in the dynamic environment that Hubs thrive in. Hubs operate in complex and uncertain environments with multiple stakeholders that behave autonomous. In this environment formal planning is hard to control. Hubs cannot induce the stakeholders to act in accordance with the ‘plan’, therefore communicative planning approaches targeted towards mutual learning and the development of a common frame of reference seem to be more adequate (Wiechmann, 2007).

A model that illustrates the adaptive strategy formation process of Hubs is the regional strategy formation model of Wiechmann (2007), shown in figure 6. The model shows the steps for strategy formation by using either the linear model or the adaptive model. The left side of the model shows the linear, deliberate, part of strategy formation and the right part shows the adaptive, emergent, part of strategy formation. The right side of the model can be related to the strategy formation process of Hubs. The strategic concept is the formulated strategy, the starting point. The strategic discourse is the gap between the strategic concept (intended strategy) and the strategy application (the realized strategy). The strategic discourse is inherent to the emergent strategy. The autonomous strategic behavior is a result of the strategic discourse and

25 a pre-condition for the strategy application. The autonomous strategic behavior is caused by the multiple participants that collaborate in the Hub, which have different perspectives on the strategic outcome. To verify the relation of strategy formation in Hubs with the model defined by Wiechmann (2007) a practice approach is needed. Therefore this study will research the strategy formation process of Hubs and identify if the right side of figure 6 fits this process.

Figure 6. Process model for analyzing regional strategy formation (Wiechmann, 2007).

3.2.2 Key elements in strategy formation

Strategy develops deliberately or emergent, but either way the strategy formation process is shaped by three key elements: goal setting, decision making and choice making. ‘Virtually all scholars agree that choice making, decision making, and goal setting are important elements of strategy formation that can be recognized as a 'pattern in a stream of decisions'’ (Kamm, 2017; Mintzberg, 1978).

A. Goal setting

The strategy perspective of a Hub influences the decisions that it will make, but it also influences the type of goals it wants to achieve. Goal setting for Hubs can be initiated on a short- or long-term basis, they can be rather general or highly specified and goals can either be simple or difficult to achieve. Previous research on goal setting showed that self-efficacy, past performance, and various social influences affect the level at which goals are set (Locke & Latham, 2006). Setting goals with a group, or network, adds a layer of complexity to the goal

26 setting process. This layer of complexity is based on the conflicts that may occur among the group’s members. Moreover, Seijts and Latham (2000) found that personal goals that were aligned with the group’s goal, enhanced group performance. But when personal goals conflicted with the group’s goal it had a detrimental effect on group performance. Also Locke & Latham (2006) found some correlations between goal setting and performance. To start, specifically defined goals lead to greater effort and/or persistence than moderately difficult, easy, or vague goals. Secondly, specifically defined goals direct attention, effort and action towards goal-relevant choices at the expense of non-goal-relevant actions, which enhances performance. Finally, specifically defined goals can motivate someone to use one’s existing ability to motivate other participants to search for new knowledge, which enhances performance. Setting goals is effective even when they are formulated by different sources. Goals can be assigned by others, they can be set jointly or they can be self-set (Locke & Latham, 2006). No matter who sets the goals, a goal represents the present condition of the Hub and the desired future state of the Hub. However, there is one key moderator in this process: feedback. Feedback is necessary to keep track of the progress and commitment to the goal, task complexity and situational constraints (Brown, Jones & Leigh, 2005). Also feedback has implications for the performance of the Hub. Namely, feedback to individuals leads to a focus on the individual’s performance, whereas feedback to the team leads to a focus on the team’s performance (DeShon, Kozlowski, Schmidt, Milner, and Wiechmann, 2004). In conclusion, goal setting and feedback are important factors for the strategy formation process of Hubs.

B. Decision making

There is limited evidence that strategic decision-making processes influence decisions' effectiveness, that is, the extent to which they result in desired outcomes (Dean & Sharfman, 1996; Eisenhardt & Zbaracki, 1992). However, some decision-making processes can increase the chance of reaching a desired outcome. Successful strategy emerges from a decision process in which Hubs develop collective intuition, accelerate constructive conflict, maintain decision pacing and avoid politics (Eisenhardt, 1999). First, one of the most important things for Hubs is to share information on all levels so that collective intuition can be build. Intuition can be developed through experience, as repeated practice allows participants to react quickly and accurately to changing events (Eisenhardt, 1990). Second, in high-velocity environments Hubs need good intuition to be able to react quickly and accurately to changing events, as conflicts are a natural feature of high-stakes decision making. Accelerating conflict stimulates innovative thinking, creates a fuller understanding of options, and improves decision effectiveness. To sustain effective decision making, decision makers emphasize the importance of

27 maintaining decision pace, not pushing decision speed. The last characteristic of effective decision making is the defuse of politics. By defusing politics, Hubs focus on achieving common goals, which helps the Hub to move forward.

Considering the elements mentioned above: 1.building collective intuition; 2.stimulate quick conflict; 3. discipline timing of strategic decision making; and 4. defuse politics, it shows that these approaches direct Hubs towards strategic decision making that leads to desired outcomes. This approach can help Hubs to build an effective strategy and so enhance performance.

C. Choice making

To be able to make the right decisions, strategic choice has to be acknowledged. The first step in choice making is to identify the participants, their possible actions and the outcomes and payoffs that will result from each possible set of actions (Zeckhauser, 1991). If a Hub wants to make an effective choice, the Hub needs to know what the likely choices of others are. Therefore the ‘golden triangle’ of strategic choice explains the three key concepts that an organization needs to keep in mind: incentives, information and valuation. These three key concepts usually must work in concert and are central to virtually any organization (Zeckhauser, 1991). The ‘golden triangle’ helps Hubs to make better choices as they focus not only on the Hub itself, but also on the environment the Hub operates in. Furthermore, Dean & Sharfman (1996) take another perspective on choice making and assume that decision processes are related to strategic choices. Decision processes that allow decision makers to accurately anticipate external factors and make choices in light of these factors should be more successful than those that do not do so. These assumptions encourage Hubs to watch their environment closely and focus on decision processes, so that their choices ensure the best possible outcomes. The decision making process and choice making process are highly intertwined in the strategy formation process of Hubs. Also goal setting contributes by creating tangible, proximate goals and processing feedback. In conclusion, strategy formation is a journey and an inherently messy one at that2_.

3.3 Strategy as practice

Recently, attention is drawn to the fact that there might be a gap in what theories say people do versus what people actually do. This concern has given rise to the ‘practice’ approach in the

2

28 management literature’ (Jarzabkowski, 2004). This more practical approach causes an interplay between levels of social context. These levels of social context are related to the concept of pluralism, which is a condition or system in which two or more states, groups, principles, sources of authority, etc. coexist. Pluralism is characterized by three main features: multiple objectives, diffuse of power and knowledge-based work processes. Hubs seem to fit all of these features and can therefore be called pluralistic organizations. Pluralistic organizations are dependent on the interplay of social context as such the strategy as practice approach uses the following definition of strategy: ‘a situated, socially accomplished activity, while strategizing comprises those actions, interactions and negotiations of multiple actors and the situated practices that they draw upon in accomplishing that activity’ (Jarzabkowski et al. 2007). The strategy as practice movement advocates for a multi-framework approach for understanding how organizations form a strategy in practice (Kamm, 2017). Moreover, the strategy as practice approach mentions that pluralist organizations have a long process of strategizing that is motivated by values and is embedded in evolving networks (Denis, Langley and Rouleau, 2007). The strategy formation process of Hubs can be linked to the strategy as practice approach that studies strategy formation from a sociological perspective. A Hub is constituted by multiple participants. ‘a quintessential trait of Hubs is that participants collaborate for creating new, joint perspectives on common goals and shared values’ (Kamm, 2017). Moreover, Hubs are a unique form of organizing, which is based on sociological and ecological values just as the strategy as practice approach advocates. The strategy as practice approach demonstrates interesting leads as participants in Hubs strategize while simultaneously developing a form of organizing in practice (Kamm, Faber & Jonker, 2015). The authors of the strategy as practice approach perceive strategy as something that people do rather than something organizations have (Whittington, 2003). Just like Hubs that are social networks whereby the strategizing process evolves from interaction between participants. Nevertheless, the sharing of views, the common goals and the opening up to cooperation and shared value creation does not necessarily mean that the participants share organizational development and define a common strategy (Kamm, Faber & Jonker, 2016). The strategy as practice approach assumes a pluralistic viewpoint, seems to be promising for developing a multi-constituent perspective on the strategizing process (Kamm, 2017). Hubs seem to fit the characteristics of the strategy as practice approach and therefore this theory will be used as the foundation for this study. However, this view on strategizing remains based on assumptions and there is no guarantee that this theory will actually fit the strategy formation process of Hubs.

29 3.4 Summary theoretical justification

Chapter 2 illustrated that Hubs are a unique form of a collaborative network. Hubs have joint

goals, joint identities and joint responsibility just like collaborative networks, but Hubs add some unique features that identify a form of organizing as being a Hub. The unique features that identify a Hub are summarized in the seven properties that are mentioned in Paragraph

2.3. Chapter 3 focuses on strategic vision and direction. Hubs are experimenting forms of

organizing and they operate in dynamic environments. Therefore the emergent strategy, illustrated by the adaptive model, fits the strategy formation process of Hubs. The adaptive model, or the ‘grassroots model’, is represented in the process model of regional strategy formation (Wiechmann, 2007). To facilitate this process three key elements of strategy formation are identified: goal setting, decision making and choice making. The pluralist nature of Hubs and its focus on a long process of strategizing while developing a form of organizing in practice fits the strategy as practice approach, which will be used as the main theoretical foundation for this study.

After analyzing the strategy literature two properties are added to the list of properties identified by Kamm, Faber & Jonker (2016). Therefore a new list of properties is constructed and stated below. Property 8 and property 9 are added to the original list. These properties are analyzed in

chapter 5 to determine if they are unique features that identify a Hub.

1. Operating in a local or regional setting; 2. Addressing wicked problems;

3. Leading to a broad configuration of participants; 4. Engaging in multiple value creating activities; 5. Issue related approach;

6. Shaped organizationally in an unconventional way; 7. Leading to a transition over time.

8. Let’s strategies root anywhere 9. Develops strategy in practice

Reflecting on the literature no contemporary scientific publications are identified that address the strategy formation process of a Hub. This study will use the literature of collaborative networks and the strategy as practice’ approach to expand the knowledge on strategy formation processes of Hubs.

30

Chapter 4 Methodology

The objective of this chapter is to outline the methodology used for conducting this study. This study used a qualitative approach that has the goal to contribute to the theory on strategy formation in Hubs. However, besides the contribution to theory this study also strives to contribute to practice. Therefore the grounded theory is being used. Three case studies provide the basis for this study. These cases are researched by means of document analysis, an introductory conversation and group sessions. Obviously this study ensured validity, reliability and researcher integrity.

4.1 Research design

To be able to answer the research question, defined in chapter 1, this study used an (empirical) qualitative research design. The choice to use a qualitative research design is based on the lack of theoretical background on strategy formation in Hubs. To gain information on the strategizing process of Hubs a qualitative research design is needed. The acquired knowledge can only be found by using an explorative, practice based approach that digs into the known theory on strategy formation and complements this theory with information gathered on the ground. New information can be used to build theory on strategy formation processes in Hubs.

Qualitative research as applied in this study is defined as: ‘multimethod in focus, involving an interpretive, naturalistic approach to its subject matter. This means that qualitative researchers study things in their natural settings, attempting to make sense of, or interpret, phenomena in terms of the meanings people bring to them’ (Denzin & Lincoln, 1994). This study needs a research design that focuses on the subject at hand as it uses theory only as a verification that this subject is significant enough to be further explored. Meanwhile, the counterpart of qualitative research is quantitative research. Quantitative research focuses on gathering objective data that can be verified by the acceptation or rejection of hypotheses. According to Vennix (2010) a theory in quantitative research is only used to derive particular hypotheses from, which are tested based on the analysis of empirical data. However this study only has minimal theory available for the subject at hand, which means that it cannot derive hypotheses from theory and needs to use an exploratory qualitative approach.

‘The goals of qualitative research is less to test what is already known, but more to discover the new and to develop empirically grounded theories’ (Flick, 2014). This definition states that reality is seen as made by people, it aims at giving (new) meaning to the researched phenomenon. Empirically grounded theory takes the interpretation of meaning in social interaction and studies the interrelationship between meaning in the perception of the subject

31 and its action (Glaser, 1992). This study aims to clarify the strategy formation process of Hubs and in doing so tries to gain insight in this process by involving the participants and contextual factors connected to this phenomenon. Therefore, theory is being developed during the data collection process. The participants of the Hubs will be involved to gather data that will eventually help to build theory. This more inductive design means that theory in this study is built from data or grounded in the data, which is the essence of empirically grounded theory (Glaser, 1992).

To be able to gather the right data and eventually build theory, the choice was made to perform multiple case studies. The aim of case studies is the precise description or reconstruction of a case (Flick, von Kardoff & Steinke, 2004). The choice to use multiple case studies is based on Yin’s (2003) four preconditions for case studies: 1. the focus of the study is to answer “how” and “why” questions; 2. you cannot manipulate the behavior of those involved in the study; 3. you want to cover contextual conditions because you believe they are relevant to the phenomenon under study and 4. the boundaries are not clear between the phenomenon and context. As ‘the goal of a case study is often an evaluation of a problem in practice’ (Boeije, 2005) a multiple case study enables the researcher to explore differences within and between cases. ‘The goal is to replicate findings across cases. Because comparisons will be drawn, it is imperative that the cases are chosen carefully so that the researcher can predict similar results across cases, or predict contrasting results based on a theory’(Yin, 2003). A multiple case study uses cases that are analyzed as separate cases and later analyzed across settings (Baxter & Jack, 2008). The idea is that the more cases one studies, the better the chances to separate the general (relevant) from the specific (irrelevant) features of a case (Swanborn, 2010). However, also this type of research design has its advantages and disadvantages. Case studies are seen as robust and reliable, as case studies provide realistic responses, but they are also seen as extremely time consuming, only showing narrow examples and/or are expensive to perform. A multiple case study is the perfect research design for studying the strategic formation process of Hubs. Since Hubs are horizontal structures where participants from different fields work together on societal and ecological issues they will have similarities, but they will also have differences. A multiple case study focuses on the comparisons between cases and that is exactly what will help this study identify unique features of Hubs. A multiple case study can gain insight in the general and specific features of the cases, to understand the particular situation of a strategy formation process within a Hub (Stake, 1995).